A packaged fuel unit and a refillable hydrogen generator that uses the fuel unit to produce hydrogen gas are disclosed. The fuel unit includes a reactant that can undergo a thermal decomposition reaction that produces hydrogen gas when heated to at least a minimum initiation temperature. The reactant is contained within a package that includes a poor thermal conductor with one or more thermal conductor sections for conducting heat from outside the package to the reactant. The hydrogen generator includes a holder with a cavity in which the fuel unit can be removably disposed and a heating system for heating the fuel unit when disposed therein. The hydrogen generator can be part of a fuel cell system including a fuel cell battery that is provided with hydrogen gas from the hydrogen generator.